Public trust in institutions and the economic system is in crisis worldwide, according to a new report. What business risks and opportunities are emerging from the turbulence?
The Edelman Trust Barometer Annual Global Study for 2017 is carried out by Edelman, a global communications marketing firm. It’s based on 17 years of online surveys in 28 countries around the world.
Warnings from the latest report include:
- the general population distrusts their institutions in 20 out of the 28 countries studied
- trust has declined in 21 of those countries since last year
- trust in NGOs, businesses, media and government all fell, with trust in the media plunging to an all-time low
- NGOs and businesses were among the most trusted, but even they were only trusted by about half the people surveyed
- CEO credibility has hit an all-time low
- more than half of those surveyed felt ‘the system is failing’, with a further third uncertain
- only 15% of people surveyed felt the system was working
- in half the countries surveyed the majority of people have lost faith in the system
- even those at the top are disillusioned – about half of college-educated, well-informed high income earners say the system is not working
The report summarises: “The mass population has rejected established authority. The mass population now has authority and influence, leaving the establishment empty handed.”
The study provides insight into where this distrust is coming from. It shows a strong correlation between those who feel the system has failed them and those carrying fears of corruption, globalisation, immigration, the pace of innovation and the eroding of social values.
The media and social media echo-chamber is also cited as a factor that accelerates and amplifies fears.
Nearly half of those surveyed said they would support politicians they trust to make things better for them and their family even if they exaggerated the truth. More than half of people do not regularly listen to people or organisations they do not agree with. They are nearly four times more likely to ignore information they don’t believe. There is also strong tendency for people to believe people like themselves.
The report looks at Donald Trump’s election and Brexit as examples of the powerful effects this has. In both cases it found the winning side included more people who were fearful and/or felt the system was failing.
How we respond to this in business can affect our purpose, our branding and the way we work with customers and our local communities.
The survey found that just over half of those surveyed felt the pace of change in business and industry was too fast. Half of those surveyed felt globalisation is taking us in the wrong direction.
But three quarters of those surveyed agreed that: “A company can take specific action that both increase profits and improve economic and social conditions in the community where it operates.”
Clearly businesses ready and willing to tackle trust issues could gain significant advantage. Business is the most trusted sector among one in three of those who are uncertain about whether the system is working.
Getting a handle on how people think can inform even the more granular decisions around our business.
For example, 70 per cent of those polled agreed that policy makers should tax foods that negatively impact health. And the most trusted person to act as a spokesmen on all major topics is an employee, not the company CEO, a senior executive, an activist consumer, academic or media spokesperson. Which goes a long way to explain the rising influence of the whistle-blowing phenomenon.
The report states: “It would be the greatest folly for CEOs to press populist leaders for less regulation – particularly in the environmental arena. Fifty-two percent of the general population say a company’s effort to protect and improve the environment is important for building their trust.”
“Expectations for business are high. The three most important attributes for building trust in a company are treating employees well, offering high-quality products and services, and listening to customers—and they matter even more to those who believe the system isn’t working.
“The trust crisis demands a new operating model for organisations by which they listen to all stakeholders; provide context on the issues that challenge their lives; engage in dialogue with them; and tap peers, especially employees, to lead communications and advocacy efforts.”
Sam McGlennon, SBN project lead, community, says: “Never has there been a more dangerous time for business to behave without transparency and integrity. Token gestures are not enough. Customers are deeply cynical about many business motivations and highly attuned to the fairness of outcomes.
“Even businesses genuinely trying to do good have a higher bar to clear: being open and authentic about their intentions and transparent about their difficulties. And above all, aiming for something that can inspire us all.
“The flipside of this scepticism is that customers will go out of their way to support businesses they truly believe in. The best businesses will continue to inspire loyalty through their openness and courageous approaches to making society a better place through business.”